European Central Bank Cuts Rates for First Time Since 2023
ECB reduces benchmark rate by 25 basis points as eurozone inflation falls to 2.1%, signaling end of tightening cycle.
The European Central Bank has cut its benchmark interest rate by 25 basis points, marking the first reduction since beginning its aggressive tightening cycle in 2023.
ECB President Christine Lagarde said the decision reflected confidence that inflation is on a sustainable path back to the 2% target. Eurozone inflation fell to 2.1% in February, down from a peak of over 10%.
"The time has come to begin normalizing monetary policy," Lagarde said in a press conference. "We expect further adjustments in the coming quarters."
European stocks rallied on the announcement, with the Euro Stoxx 50 gaining 1.8%. The euro weakened against the dollar as rate differentials shifted.
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